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Rupee sheds 4 paise, ends at 64.38 as on heavy dollar buying ahead of FOMC

Rupee remained under pressure & swung between 64.35 and 64.42 due to uneven dollar demand

Press Trust of India  |  Mumbai 

Illustration by Ajay Mohanty

The on Tuesday weakened further to close 4 lower at 64.38 against the on sustained demand for the American from importers.

With the rate decision fast approaching, overall market undertone remained little shaky as traders preferred to stay on the sidelines and avoided taking any long positions.

Fresh unwinding by Foreign portfolio investors (FPIs) also weighed on the sentiment.

However, a breathtaking record rally in local equities along with subdued dollar overseas trend largely cushioned the fall, a trader said.

The opened substantially lower at 64.42 from overnight close of 64.34 at the (forex) market.

It remained under pressure throughout the day and swung between 64.35 and 64.42 due to uneven dollar demand and supply before ending at 64.38, showing a loss of 4 paise, 0.06 per cent.

The RBI, meanwhile, fixed the reference rate for the dollar at 64.3580 and the at 75.0607.

In cross-currency trades, the rupee continued to drift against the pound sterling and settled at 83.96 from 83.85 per pound and dropped further against the to finish at 75.05 as compared to 74.92 earlier.

The domestic unit, however, recovered against the Japanese yen to close at 57.77 per 100 yens from 58.09 yesterday.

The was little changed against its major rivals as the focus of attention shifted to the Federal Reserve's statement outcome on Wednesday, where consensus remains pretty divided.

Meanwhile, domestic equities retreated after hitting an all-time historic high as caution and resistance returned to the forefront, triggering profit-taking in select frontline heavyweights.

In a landmark achievement, the benchmark conquered the key 10,000 milestones in early session.

Marking a strong year, Indian market has been witnessing a series of record breaking rallies on account of normal monsoon, smooth GST rollout, reform initiatives and other macro factors.

On the global front, the dollar slumped to over one-year low against a basket of currencies on Tuesday as investors grew more wary on the short-term outlook although they held off placing more bearish bets ahead of the meeting starting today.

The dollar index, which measures the greenback against a basket of currencies, was down at 93.54 during - its lowest since June 2016.

In forward market today, premium for dollar eased further on sustained receipts by

The benchmark six-month premium payable in December declined to 124-126 from 126-128 and the far forward June 2018 contract also edged down to 270-272 paise from 273-275 paise.

On the International commodity front, crude prices extended gains for the second day after OPEC moved to cap Nigerian oil output and Saudi Arabia pledged to limit exports next month to help rein in global oversupply.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Tue, July 25 2017. 20:58 IST